New survey fee: ‘300% increase is disincentive to housing delivery’

The recent increase in survey fee by the Nigerian Institution of Surveyors (NIS), Lagos State chapter, has been described as a disincentive to housing delivery in the state which needs all the houses that could be produced, especially by private developers, to reduce its staggering housing deficit.

NIS Lagos Chapter recently, in a terse statement, announced an increase in its survey fee by 300 percent to N1 million, up from N250,000 paid for surveying services by land buyers in a state where land value is second to none and the cost of perfecting titles runs neck-to-neck with the main price of the land.

The Real Estate Developers Association (REDAN), South West Zone, says though it is not opposed to any association, institution or professional grouping making changes in its professional service fees, still queries the rationale and equity in 300 percent increase in survey fee.

“We are discussing with both the national and state executive officers of the institution to see how this inequitable increase could be reversed”, revealed Taiwo Ogunbodede, REDAN’s South West chairman in an interview in Lagos.

Ogunbodede said the increase would make housing all the more unaffordable and it would lead to increases in house prices, noting that the decision to come out with that increase was unfair, inequitable.

“We want the NIS to reverse that increase and thereafter engage professional bodies in the building sector on discussion, because as it is nobody knows yet where and why the new fee will be applied. There are some locations in this state where the price of a plot of land is not up to N1 million”, he said.

Ogunbodede who is also the national vice president of REDAN, hope that NIS would be persuaded to see reason as a major stakeholder in an industry (housing) that is seemingly the worst hit by the challenges in the economy.

But, he believes that, because the property market fundamentals remain intact despite recession, developers would continue to put products on the market. “Nigeria remains a big real estate market by reason it large and growing population and fast-paced urbanization; the housing deficit remains high at 17 million units, more Nigerians are graduating from universities, getting jobs and needing houses, and the informal sector is growing with high demand for real estate assets”, he noted.  

 His company recently embarked on two new developments, namely Orangeville and Shepherd 11 Apartments located in Okun Ajah and Ibeju Lekki respectively. While Orangeville is a 24-unit apartments block comprising 12 units of 2-bedrooms and 12 units of 3-bedrooms, Shepherds 11 is a 16-unit project consisting of 8 units of 2-bedrooms and another 8 units of 3-bedroom apartments.

As a demonstration of its understanding of the challenges in the property market, the company has put in place mechanisms aimed to stimulate interest and demand for the projects. “Before now, we were demanding as high as 30 percent down-payment from buyers. Now, for these our new projects, we are asking for just 10 percent and the rest payment spread over 24 months”, Ogunbodede informed.